26 Corporations Paid No Corporate Income Tax

[source]

Taxes

Hot off the press, the latest research from Citizens For Tax Justice:

The U.S Has A Low Corporate Tax

Who Pays Taxes In America?

Corporate Tax Dodgers

Citizen For Tax Justice has released an extensive report detailing corporate tax dodgers from 2008-2010.

Corporate Taxpayers & Corporate Tax Dodgers 2008-10

Press release with key findings:

A comprehensive new study that profiles 280 of America’s most profitable companies finds that 78 of them paid no federal income tax in at least one of the last three years. Thirty companies enjoyed a negative income tax rate over the three year period, despite combined pre-tax profits of $160 billion. These are among the findings in “Corporate Taxpayers and Corporate Tax Dodgers, 2008-2010,” released today by Citizens for Tax Justice and the Institute on Taxation and Economic Policy.

“These 280 corporations received a total of nearly $223 billion in tax subsidies,” said Robert McIntyre, Director at Citizens for Tax Justice and the report’s lead author.  “This is wasted money that could have gone to protect Medicare, create jobs and cut the deficit.”

The study examines 280 corporations, all from the Fortune 500 list.  All of the companies were  profitable in each of the last three years and provided sufficient and reliable information in their  financial reports about their pretax U.S. profits and their U.S. federal income taxes. Corporations are lobbying for lower corporate rates and an exemption for profits they shift  offshore. McIntyre, however, says “Our study provides proof that too many corporations are  already being coddled by our tax system.” Findings in the report include:

 The average effective tax rate for all 280 companies in the study over the three year period was 18.5 percent; for the period 2009-2010 it was 17.3 percent, less than half the statutory rate of 35 percent.

 78 of the companies enjoyed at least one year in which their federal income tax was zero or less.

 30 companies enjoyed a negative income tax rate over the entire three year period on their combined pre-tax profits of $160 billion.

 Total tax subsidies given to all 280 profitable corporations amounted to $222.7 billion from 2008-2010.

 Wells Fargo tops the list of 280 U.S. corporations receiving the most in tax subsidies, getting nearly $18 billion in tax breaks from the U.S. treasury in the last three years.

 Pepco Holdings had the lowest effective tax rate of all the companies in the study, at negative 57.6 percent over the three year period. Some companies within sectors fare worse than others. For example, the report finds that FedEx paid a 0.9 percent tax rate over the three year period while its competitor, UPS, paid a 24.1 percent rate.

 While retailers and wholesalers in the study generally pay average effective tax rates of about 30 percent, Amazon.com paid a rate of only 7.9 percent on its $1.8 billion in profits from 2008-2010.

 Financial services received the largest share (16.8 percent) of all federal tax subsidies over the last three years. More than half of federal corporate tax subsidies for companies in the study went to four industries: financial services, utilities, telecommunications, and oil, gas & pipelines.

 The top ten defense contractors saw their combined tax rate decline from 19.3 percent in 2008 to a mere 10.6 percent rate in 2010.

 U.S. corporations with significant (ten percent or more of their total worldwide profits) foreign profits paid tax rates to foreign countries that were almost a third higher than they paid to the IRS on their domestic profits.

Better Ways To Spend $36 Million

From the Citizens for Tax Justice:

"On Sunday the Milwaukee Journal Sentinel published an interesting article about the capital gains tax breaks that Governor Scott Walker is proposing in his biennial budget. The article’s title “Walker’s proposed capital gains tax break gets lukewarm backing” says it all. Capital gains tax breaks are costly and are extremely regressive because most capital gains income is received by the richest taxpayers.

Wisconsin already allows a tremendously generous 30 percent exclusion for capital gains income, which ITEPestimates cost more than $150 million in 2010. The Governor is proposing two changes to how capital gains are currently taxed: “a 100 percent exclusion for capital gains realized on Wisconsin-based capital assets held for five or more years and a 100 percent capital gains tax deferral for gains reinvested in Wisconsin-based businesses.”

If implemented, these changes would cost the state about $36 million over the next two fiscal years. At a time when the state is facing a $3.6 billion dollar shortfall, surely there are better ways that $36 million could be used."

Untouchable Taxes

Lawmakers in four states want to make tax reform even more difficult. In Wisconsin, the idea being floated about is to require a supermajority (two-thirds) vote to raise taxes.

Tea Bag This

Citizens for Tax Justice has found President Obama Cut Taxes for 99% of Working Families in Wisconsin in 2009.

Trickle Up Economics

From Citizens For Tax Justice:

"Rep. Paul Ryan's GOP Budget Plan would collect $2 trillion less over a decade and yet require the bottom 90 percent to pay higher taxes."

Tax Justice

More stellar research and analysis from Citizens for Tax Justice:

Bush tax cuts cost two and a half times as much as House Democrats' health care proposal
Multinational Corporate Tax Abuses
Principles for Tax Reform
Spending Program Buried Within Tax Code
Why We Need A Strong Estate Tax

Tax Cuts v Health Care

Health care reform legislation is projected to cost $1 trillion, if enacted, from 2010 to 2019. Republicans have been feigning outrage. George Bush’s tax cuts cost $2.5 trillion from 2001 to 2010.

As Citizens for Tax Justice comment, “Many of the lawmakers who argue that the health care reform legislation is too costly are the same lawmakers who supported Bush tax cuts.”

52.5 percent of the tax cuts went to the richest 5 percent of taxpayers.